Airbnb in Edinburgh

Holiday lets existed in Edinburgh prior to the Internet, and are important to attract the tourist economy, and allow for peak supply at important events like the Edinburgh Festival Fringe.

However, with the Private Rental Sector's (PRS) rise in importance to provide rental housing in Edinburgh, along with the introduction of Airbnb, which allows for the instant conversion of a residential rental flat to a commercial holiday let, and its massive supply of "guests"; the largely unregulated use of PRS housing for holiday lets should now be questioned.

Based on data collected from Airbnb's web-site for Edinburgh, in September, 2017:

There are 9,638 Airbnb listings, and although Airbnb describes its business model as "hosts" renting out spare rooms to tourists, the majority (57%) of Airbnb properties in Edinburgh are entire homes or flats, where the host isn't present.

Approximately 3,515 entire homes are rented out frequently, for an estimated 188 nights per year.

While small compared to the total number of Edinburgh homes, in neighbourhoods with low vacancy rates, Airbnb rentals could be displacing city residents relying on private rentals, and challenging their residential character.

More than a third (2,030 of 5,474) of entire home/flat Airbnb rentals in Edinburgh are professional hosts (property investors or managers) with more than one entire home/flat rental; and they generate more than half of the revenue for this type of Airbnb listing.

In most cities that are concerned about housing and the unrestricted conversion of residential properties via short-term rental platforms like Airbnb and their hosts; multiple entire home listings are usually the first to be the subject of regulation and enforcement.

The Law

Scottish and Edinburgh laws allow for nuisance complaints against holiday lets and/or "party flats", or regulations when renting to 3 or more unrelated persons at any one time (Houses in Multiple Occupancy, or HMO).

The current planning position is that short term holiday lets are residential uses within the authorised use of residential properties.

As no material change of use has taken place, such uses are out with the control of the Planning authority and can not be added to a list of activities which could not be carried on in a flat without consent.

A Planning authority has no power to change the situation set out in the legislation, or more specifically in the Use Classes Order. Any such change would be a matter for the Scottish Parliament.

It is understood that the Scottish Government is not currently considering a review of the Use Classes Order.

The council does report that Planning Permission may be required when "changing the use of a residential property to a short stay commercial leisure apartment", however it's not clear if this permission is being asked for current short term lets. From pages 6 and 7 of the Planning Guidance for Businesses:

Using your home as a guest house

Planning permission will not be required for the use of a house as a bed and breakfast or guest house if:

The house has less than four bedrooms and only one is used for a guest house or bed and breakfast purpose

The house has four or more bedrooms and no more than two bedrooms are used for a guest house or bed and breakfast purpose

Planning permission will always be required if a flat is being used as a guest house or bed and breakfast, regardless of the number of rooms.

Short Term Commercial Visitor Accommodation

The change of use from a residential property to short term commercial visitor accommodation may require planning permission. In deciding whether this is the case, regard will be had to:

The character of the new use and of the wider area

The size of the property

The pattern of activity associated with the use including numbers of occupants, the period of use, issues of noise, disturbance and parking demand, and

The nature and character of any services provided.

Airbnb data for Edinburgh

Inside Airbnb

A conservative occupancy model has been built in order to estimate Occupancy Rates, Income per Month and Nights per Year. More information on the methodolgy of the occupancy model can be found in the disclaimers.

Inside Airbnb: Edinburgh uses the following parameters:

A high availability metric and filter of 60 days per year

A frequently rented filter of 60 days per year

A review rate of 50% for the number of guests making a booking who leave a review

An average booking of 3 nights unless a higher minimum nights is configured for a listing.

A maximum occupancy rate of 70% to ensure the occupancy model does not produce artifically high results based on the available data

If you are a data scientist, urban or public policy planner, researcher or journalist, get the data, analyze and publish your results.

Acknowledgements

Dan Cookson, a Housing market information specialist (especially PRS) based in Edinburgh, who provided INVALUABLE advice on the appropriate boundaries to use for Edinburgh.

Kenneth Reid, who is studying an MSc in Real Estate Investment & Finance at Heriot-Watt University, who shared his views and research on short-term letting.

Listings per Host

A host may list separate rooms in the same apartment, or multiple apartments or homes available in their entirity.

Hosts with multiple listings are more likely to be running a business, are unlikely to be living in the property, and in violation of most short term rental laws designed to protect residential housing.